The electronic dance music business, propelled by huge festivals featuring star D.J.’s and psychedelic light shows, has grown to an estimated worth of $4.5 billion, a number that is luring both Wall Street investors and mainstream corporate sponsors. Yet a recent string of drug-related deaths has highlighted the risks not only to fans, but to the businesses looking to profit from the craze.
Since March, at least seven young people attending dance events around the country have died after exhibiting symptoms consistent with overdoses from MDMA and other so-called party drugs, often called ecstasy or molly. This month, the Electric Zoo festival on Randalls Island was shut down at the request of New York City officials after two patrons died, apparently from MDMA overdoses, officials said.
Executives say that deaths like these have the potential to scare off investors and the corporate sponsors that are eager to reach the genre’s young, affluent and technologically connected fans.
The ecstasy-related deaths come just weeks before an expected initial public offering by SFX Entertainment, a new company whose fortunes are predicated on sponsorship and media deals for electronic dance music, or E.D.M. According to its prospectus, SFX wants to raise as much as $300 million through its I.P.O., much of it to acquire promoters like Made Event, the company behind Electric Zoo.
Festivals draw tens of thousands or even hundreds of thousands of fans to see well-known D.J.’s like David Guetta, Tiesto and Deadmau5, with top festivals charging up to $300 for two or three days of music. Defenders of the dance world say they are being singled out by the news media. Drugs and overdoses, they say, have long been associated with popular music. For example, 10 people have died since 2002 at the Bonnaroo festival in Tennessee, many from drug-related causes.
“The scrutiny that this is going to come under because of the stock market deal with SFX, it’s like a magnifying glass that’s unfair,” said Amy Thomson, the manager behind Swedish House Mafia, one of the genre’s most successful acts.
Robert F. X. Sillerman, the chief executive of SFX, said in an interview that his company was committed to providing a safe environment, and that as dance music “has grown from uncontrollable rave parties to professionally run festivals and events, it in fact provides the opportunity to provide health and safety guidance.”
He declined to discuss business details, citing the mandatory “quiet period” before the I.P.O. But TomorrowWorld, a festival near Atlanta this month in which SFX is a majority partner, is working with DanceSafe, a nonprofit group, to provide educational information about the dangers of drug use, said Shawn Kent, one of the executives behind the event.
SFX seemed to anticipate the need for greater medical care when it appointed to its board Dr. Andrew N. Bazos, an orthopedic surgeon with experience in “comprehensive medical coverage for large-capacity venues,” according to its prospectus.
Drugs have been linked to the mythology and slang of dance culture for decades, and the current ecstasy scare reflects an earlier wave in the 1990s when cities around the country cracked down on illegal raves. Today, stars like Miley Cyrus and Kanye West allude to molly in songs, and the term turns up repeatedly at festivals, on T-shirts, banners or body paint.
Among the deaths in recent months is that of Matthew Rybarczyk, a 20-year-old from Staten Island, who collapsed with a 107-degree temperature at a Governors Island rave on July 14.
When Mr. Rybarczyk’s grandmother saw him in the hospital the next morning, he was contorted unrecognizably and was bleeding from his nose and mouth; he died 14 hours later. The medical examiner found methylone in his system, an ecstasylike drug sometimes sold as molly.
“It was the saddest thing of all to watch him die,” his grandmother, Peggy Rybarczyk, said. “He went to have a good time and he never came home.”
A growing history of drug-related deaths has not slowed the genre’s popularity. In 2010, a 15-year-old girl died from an overdose of ecstasy at Electric Daisy Carnival in Los Angeles, but the festival has since spread around the country and even to London. This year, Live Nation Entertainment, the world’s biggest concert company, bought half of Insomniac, the company behind the festival, for a reported $50 million.
In an interview, Pasquale Rotella, Insomniac’s founder, defended his company’s security measures, and said that dance promoters, to some degree, “inherit societal problems.”
But he and others in the industry admitted that the negative perceptions had kept away sponsorship money.
“If you look at dance festivals in general, you don’t typically see a ton of branding yet,” said Edward H. Shapiro, a lawyer who works with dance acts. “Part of that has been this notion that it isn’t an environment that is ripe for really big brands to participate in.”
Many of the most prominent branding deals in the electronic dance music world have been tied to artists, including Absolut Vodka with Swedish House Mafia, and Pepsi with the D.J. Calvin Harris. But for even the most popular dance festivals, the sponsor rosters are dwarfed by those of comparable rock and pop events, like Lollapalooza or Coachella.
The sponsors of Electric Zoo this year included Coors Light and Blue Moon beers, owned by Molson Coors; Vita Coco, a coconut water drink; and Hi-Chew, a fruit-flavored snack. Constellation Brands, whose Pacifico beer was also a supporter, said in a statement that its sponsorships “are focused on providing a peaceful, safe and responsible environment for fans 21-and-older to enjoy our product, and are made on a case-by-case basis.” Other sponsors have not commented.
Most major festival promoters have zero-tolerance drug policies, and their sites have security checks, free water stations, first-aid tents and ambulances on call. Such measures are essential for insurance purposes and are often required by state law for any large gathering.
No promoter can prevent all drugs from entering a festival site, nor can do they do anything about drugs consumed before an attendee walks through the gate. Yet many in the dance world think promoters and stars need to do more to discourage it.
“I don’t think we should be scared of saying ‘don’t do drugs,’ ” said A-Trak, a top D.J. “There is this sort of elephant in the room, where people are scared to say, ‘That stuff is dangerous and don’t mess around.’ ”
But Armin van Buuren, another popular D.J., said that Electric Zoo was one of the better-run festivals he had attended, with plenty of security and medical personnel.
“For some reason we have the stamp of drug misuse and I think that it’s unfair,” he said. “It ruins the party for a lot of other people.”
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